The Australian National Railways Commission was established by the Whitlam Government in 1975 following a promise made before the Federal election in December 1972. Gough Whitlam said that if his party was elected to government he would invite the States to hand over their railway systems to the Commonwealth, his dream was to have one railway system for the Australian nation.

On 1 July 1975, he made good that promise by establishing the Commission which acquired the assets and operations of the Commonwealth Railways. As a result of the offer to the States the governments of South Australia and Tasmania, both of which were of the same party as the national government and whose railway systems were deeply in debt, accepted. During the next two years discussions between those two States and the Federal Government resulted in a number of staffing and operating agreements being made that resulted in the whole of the Tasmanian Government Railways and the freight business and non-urban railways of South Australia being transferred to the Commonwealth and operated by the Commission. The date of the hand over was 1 March 1978. The metropolitan Adelaide railway lines remained with the State Transport Authority, now TransAdelaide).